It is one thing for a logging contractor to have a wildfire erupt on his block while harvesting, and to suffer an equipment loss in that process. That loss could happen merely because the equipment is there. It could happen while the contractor uses his equipment to fight that fire. Most fire insurance will cover that loss.

It is quite another thing to take equipment into harm’s way, by bringing it to a fire in order to fight it. Almost certainly the contractor’s ordinary insurance is not going to cover that loss.

Contractors offering their equipment to government to fight fires need to be aware of this recent change.

Previously, the province provided “limited indemnity” for, and only for, direct loss or damage to heavy equipment caused by fire or upset while the heavy equipment is under the supervision or direction of the province and being used for fire suppression activities. In other words, if a loss occurred while equipment was hired out to government to fight fires, that loss would be covered by government. Subject to a $1,000 deductible. This was part of the deal, and the contractor wasn’t obligated to pay any insurance premiums for this limited indemnity coverage.

More recently, however, the province is giving this option: pay the province $2 per hour for limited indemnity coverage, or go without. This option is presented in the 2018 Fire Centre Equipment Information Form.

In my mind, the check boxes on this form can be confusing. Applicants are first asked “Do you currently or will you be carrying Physical Loss and Damage Insurance on Heavy Equipment?” They are next asked “If Yes, do you want the optional Limited Indemnity insurance as provided by the Province? (Note: your rental rate will be reduced by up to $2.00 per hour for this coverage)”

Many informed contractors, I suggest, will be confused by this form. They will think they are being asked if they want double coverage, and they will decline it. And, if they suffer a loss, they will learn a very expensive lesson.

The bottom line is this. Contractors should always check the “Yes” box. Because their ordinary insurance will not cover them if they bring equipment to a fire.

In my view, government should return to the prior situation, where the contractor was not even presented the opportunity to fight fire without limited indemnity coverage.

One more point to make is this. While under the government’s coverage, there may not be coverage if equipment is parked for the night, because it is not then under the supervision of government. There may be no coverage if the damage was caused by something other that “fire or upset”, such as vandalism, theft, or a collision.

John Drayton is a lawyer with Gibraltar Law Group who practices in the areas of forestry and motor transport law.